Zaakpay, the MobiKwik-promoted payment gateway aggregator, is being hived off as a wholly-owned subsidiary of One MobiKwik Systems, which owns MobiKwik wallet but with a separate business head and a dedicated engineering team.

The transaction can make Mobikwik the second unicorn from India’s fintech industry after Alibaba-backed Paytm and indicates a revival of venture capital funding after valuation plunged in the past year.

MobiKwik was founded in 2009 by Bipin Preet Singh and Upasana Taku. It has so far raised $70 million funding from Sequoia Capital, American Express, Tree Line Asia, MediaTek, GMO Payment Gateway, Cisco Investments, and Net1

Electronic payment firms got a big boost when India abolished most of the country's banknotes last year but rival state-sponsored e-payment services are forcing them to raise their game to hang on to their new customers.

While Budget 2017 seems to have given unprecedented focus to digital payments and infrastructure for adoption of new payment forms, several issues for the digital payments industry have not been answered.

MobiKwik powers digital wallet payments for major retailers such as Amul, Big Bazaar, Croma, Pantaloons and others. The company also offers payments at pan India toll plazas, IRCTC, major gas companies and petrol pumps across India.